On Monday, 22 January, Ben Lake MP demanded fairer trading practices in the food supply chain during a debate in Westminster on the ‘Groceries Supply Code of Practice’.
The debate was triggered following a petition calling on the UK Government to amend the Groceries Supply Code of Practice (GSCOP) to require retailers, “without exception”, to: “Buy what they agreed to buy, Pay what they agreed to pay [and] Pay on time”.
The Groceries Supply Code or Practice (GSCOP, or the Code) was introduced in 2009 following a market investigation by the Competition Commission. Farming groups have frequently called for the GSCOP to be amended to cover indirect supplies to grocery retailers.
In the debate on Monday, Ben Lake MP called for a strengthening and broadening of the GSCOP to support and protect farmers as producers in the food chain. Mr Lake emphasized the severe uncertainty faced by farmers, including those in Ceredigion, with heightened input costs due to inflation. While farmers are struggling, large grocery industry businesses have been exercising unfair trading practices.
Ben Lake MP stated that a power imbalance currently exists between supplier and retailer with the retailer applying short-term pressures on suppliers, without much understanding of the long-term consequences. Contracts and verbal agreements are changed at the very last moment in terms of price and demand.
Ben Lake MP said: “Why should we be so concerned about this issue? The fact of the matter is that many of these awful practices are causing such strain for farmers across the UK that far too many are considering whether they have a future in the industry. Some 25% of dairy farmers are considering whether they will still be milking in a year’s time. The impact that that has on not just our productive capacity, but our food security is quite severe.
“I will end by reiterating the call from the petitioners and the Riverford farming campaign not only to strengthen the Groceries Code Adjudicator so that it is empowered to take effective and, if needs be, punitive action against those committing unfair trading practices in the supply chain, but to extend the groceries supply code of practice to intermediaries as well. It beggars belief that we are here debating the importance and urgency of enshrining the simple principle that retailers should give suppliers certainty that they will buy what they agreed to buy, pay what they agreed to pay and pay on time.”